SHOULD FOREIGN COMPANIES LIKE AMAZON OR THE BOOK DEPOSITORY GET AN ADVANTAGE OVER AUSTRALIAN ONLINE RETAILERS - BY THE FOREIGNERS NOT HAVING TO PAY THE GST - WHEN THEIR SMALL AUSTRALIAN COMPETITORS DO ? Story by Greg Brown in todays The Australian ..........., THE Engadine Music Shop in Sydney’s south works hard for its sales. Staff can spend an hour advising a customer on the right trumpet or guitar, only to see the sale walk out the door after they find cheaper, GST-free prices on their smartphone from overseas. Assistant manager James Underwood lost two sales before lunch last week. “We get a fair amount of it, especially with customers on their phone,’’ he said. “You will show them a product and you go away to get them a price on it, and they bring it up on (the internet) for cheaper.” Many of the sales lost to overseas stores were at a discount of less than 10 per cent, meaning GST was the deciding factor, he said. While leading retailers have been most vocal in seeking a change in the loophole that means goods bought online from overseas for less than $1000 do not incur GST, small-business owners also argue a change will boost jobs. John Brandman, the owner of Engadine Music Shop, said he would employ between 15 per cent and 20 per cent more staff but for the impact of the GST-free online sales. “I would assume it is the same for thousands of small business owners across Australia,” Mr Brandman said. He opened the store in 1980 and employs 12 full-time staff. He sells instruments online, but buyers are still slugged with GST because the company is local. “(The online GST threshold) has really just turned out to be a tax bonus provided by Australia to every foreign fella in goods and services,’’ he said. “The wholesalers and the retailers all have cut their margins to try and get things down to a global-parity pricing, but the GST is really just the straw that breaks the camel’s back,” Federal Liberal MP Craig Kelly, Mr Brandman’s local member, said the GST debate was not about online shopping versus bricks-and-mortar retailing. “We are placing retailers in Australia, both online and bricks and mortar, at a competitive disadvantage — and that will cost Australian jobs,” Mr Kelly said. “I don’t see why companies like Amazon or the Book Depository or eBay can’t be made to register to pay Australian GST exactly the same way as if they were operating here in Australia.” He said many products ordered from foreign websites would remain cheaper because of Australia’s high wages and store rental costs. “Its not going not stop people ordering overseas, but at least we can level the playing field.” m.theaustralian.au/national-affairs/treasury/familiar-tune-for-small-business-as-gst-free-sales-walk-out-door/story-fn59nsif-1227174211451
Posted on: Mon, 05 Jan 2015 01:03:51 +0000
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